cancel insurances after death of insured?

[reds1115]

What is the name of your state (only U.S. law)? Pa.

Concerned over action and need to know if it was legal or if I will be liable?
Dad remarried, sold our family home and moved into the house of his new wife. Their prenup stated he could stay in her house if she died before he did.
She passed away in 2010. Dad stayed in the house until his passing on October 7, 2013. When he passed on Oct 7 her 2 sons changed the locks and would let us enter the home until the early part of november. We noticed a leak in the ceiling at the time and pointed it out to the son that monitored our visit. Homeowners insurance was paid by dad for her home which now belongs to her sons since she has already passed. Insurance policy was cancelled effective October 11 which was the furthest the insurance company could go back since we didn't have a bill of sale. Now there is a flood in the house and the sons are trying to sue the insurance company (and perhaps myself or the estate) for cancelling the policy. Are we liable? Shouldn't they have purchased their own insurance since they were now the owners of the house? Please advise. Thank you!

 

[justalayman]

tell them they needed to purchase insurance to cover their property. Your father had no obligation after his death and especially once the children took actual control of the property, any residual liability your father or his estate would have ceased.

 

[reds1115]

tell them they needed to purchase insurance to cover their property. Your father had no obligation after his death and especially once the children took actual control of the property, any residual liability your father or his estate would have ceased.

Thank you! That is what I thought but wasn't sure if he would be responsible until the house was sold.

 

[tranquility]

Was the life estate on the deed or was it stated in a living trust of some sort? If solely on a pre-nupital, that is more contractual and the answer may not be as clear without some research.

If a contractual obligation, you might have some duty to maintain insurance until some reasonable time after warning the person(s) receiving the property your duties have ended. Heck, it may not be a life estate at all and the person who is required to provide insurance would be listed in the pre-nup and create a contractual duty there as well. Does the pre-nup mention insurance responsibilities in the event of a death? Was the property probated to be distributed to the children? Did the court find some sort of testimentary trust to hold the life estate for father?

 

[reds1115]

Was the life estate on the deed or was it stated in a living trust of some sort? If solely on a pre-nupital, that is more contractual and the answer may not be as clear without some research.

If a contractual obligation, you might have some duty to maintain insurance until some reasonable time after warning the person(s) receiving the property your duties have ended. Heck, it may not be a life estate at all and the person who is required to provide insurance would be listed in the pre-nup and create a contractual duty there as well. Does the pre-nup mention insurance responsibilities in the event of a death? Was the property probated to be distributed to the children? Did the court find some sort of testimentary trust to hold the life estate for father?

It is solely on the pre-nup. The pre-nup states that the house is 100% hers and that if she passes before him (she did in 2010) he could reside in the house until he passes. At that time the house becomes part of her estate. There are no clauses regarding expenses. It appears they are negligent, have turned off the heat and the water main broke. They are still threatening to sue first the insurance company for allowing the policy to be cancelled and if that doesn't work they will then go ofter the condo association and lastly sue my dad's estate (me) for cancelling the policy. Dad was primary insurer, their mother secondary. I've been advised they should have obtained homeowners insurance when she passed in 2010. Even if a policy existed they were negligent (the house is empty and policy was not on an empty home, the heat was turned off and the pipes not winterized). not sure what happened when they probated her will. They really don't keep us in the loop. They "assumed" we were going to keep the insurance until the next billing cycle. When I called to cancel utilities I was told it was already done by one of her sons, so I "assumed" they were taking care of insurance as well. Since they locked us out of the house as soon as dad died there was not real good communication.

 

[tranquility]

I do not know what you had then. A court may find there was a life estate where dad had responsibility to insure the property until he died or a court may find he had a contractual right to live there and had responsibility (through his estate) to properly notify the owners regarding the cancelling of insurance. The litigation will be uncertain.

 

[reds1115]

I do not know what you had then. A court may find there was a life estate where dad had responsibility to insure the property until he died or a court may find he had a contractual right to live there and had responsibility (through his estate) to properly notify the owners regarding the cancelling of insurance. The litigation will be uncertain.

Thank you for your response. Assuming a life estate is an actual document would this be something her family would have? Would they not have told us what was included? Seems that would have been in their best interest. I know this counts for nothing legally but had they not kicked us to the curb (once when their mom died and they told us flat out that we were not family and the second time when dad died and they changed the locks) the lines of communication would have been open. I called several utilities and such to cancel and found it had already been done by her son. I "assumed" they were handling what was their responsibility and I needed to handle what was ours and cancelled the policy 2 months after his passing. The house is empty and the policy was only for inhabited dwelling. An uninhabited dwelling would have been much more expensive to insure. I guess I just have to wait and see.
thanks again!

 

[LdiJ]

Thank you for your response. Assuming a life estate is an actual document would this be something her family would have? Would they not have told us what was included? Seems that would have been in their best interest.

No, a life estate is an arrangement where one spouse is entitled to reside in a home after the other dies, even though ownership of the house passes to someone else. The pre-nup may have granted your father a life estate, or may have just been a contractual obligation. There would be no other document.

I know this counts for nothing legally but had they not kicked us to the curb (once when their mom died and they told us flat out that we were not family and the second time when dad died and they changed the locks) the lines of communication would have been open. I called several utilities and such to cancel and found it had already been done by her son. I "assumed" they were handling what was their responsibility and I needed to handle what was ours and cancelled the policy 2 months after his passing. The house is empty and the policy was only for inhabited dwelling. An uninhabited dwelling would have been much more expensive to insure. I guess I just have to wait and see.
thanks again!

I honestly think that you handled it unwisely. The retroactive cancellation was the most unwise portion. You stated that they let you in, in November and that is when you pointed out the leak, but you cancelled the policy two months after he died, so that would have been in December, AFTER you noticed the leak. Yes, I understand that the policy was for an inhabited dwelling...but had you simply cancelled the policy as of that date, December date, giving them at least some notice that you were doing so, then there is absolutely no way whatsoever that they would have even the slightest chance of making you liable.

However, that retroactive cancellation gained you very little...but put you at risk. Now if they sue you, you will have to prove their negligence caused the damage. Which you probably can prove...but its going to cost you to do so. You will also have to prove that the insurance would not have covered the damage anyway, which might be a bit more difficult. Why? Because the house was incidentally unoccupied due to the death of your father, and for only a very short time before the damage occurred.

Why did you do a retroactive cancellation?

 

[reds1115]

No, a life estate is an arrangement where one spouse is entitled to reside in a home after the other dies, even though ownership of the house passes to someone else. The pre-nup may have granted your father a life estate, or may have just been a contractual obligation. There would be no other document.



I honestly think that you handled it unwisely. The retroactive cancellation was the most unwise portion. You stated that they let you in, in November and that is when you pointed out the leak, but you cancelled the policy two months after he died, so that would have been in December, AFTER you noticed the leak. Yes, I understand that the policy was for an inhabited dwelling...but had you simply cancelled the policy as of that date, December date, giving them at least some notice that you were doing so, then there is absolutely no way whatsoever that they would have even the slightest chance of making you liable.

However, that retroactive cancellation gained you very little...but put you at risk. Now if they sue you, you will have to prove their negligence caused the damage. Which you probably can prove...but its going to cost you to do so. You will also have to prove that the insurance would not have covered the damage anyway, which might be a bit more difficult. Why? Because the house was incidentally unoccupied due to the death of your father, and for only a very short time before the damage occurred.

Why did you do a retroactive cancellation?

Actually I called to inquire, explained the situation, dad died, the house is not ours etc. and since there were no claims against the policy they offered to set the date of cancellation at the date of death. They lived in a townhome and the roof was the responsibility of the homeowners association. the ceiling was slightly damp and not a big deal. The roof would have been covered by the association policy, a little kilz and paint would have handled the ceiling dampness. This damage was a broken water main since they had no heat on in the house.

 

[reds1115]

Actually I called to inquire, explained the situation, dad died, the house is not ours etc. and since there were no claims against the policy they offered to set the date of cancellation at the date of death. They lived in a townhome and the roof was the responsibility of the homeowners association. the ceiling was slightly damp and not a big deal. The roof would have been covered by the association policy, a little kilz and paint would have handled the ceiling dampness. This damage was a broken water main since they had no heat on in the house.

What is confusing to me is should not the new owners, the sons, have taken out insurance on the home when their mom, the owner passed away?
Wasn't my dad more a renter? The only policy we could find was dated 2005 prior to the death of the homeowner. All statements after 2010 when she died was directed to my dad and had no reference to her name at all. They "assumed" they had valid insurance and I "assumed" that my dad had no further obligation to pay the insurance especially since the house was up for sale 6 days after we gained entrance. Now the one son is claiming he lived there which was a blatant lie and I assume fraud.

 

[tranquility]

What is confusing to me is should not the new owners, the sons, have taken out insurance on the home when their mom, the owner passed away?
Wasn't my dad more a renter? The only policy we could find was dated 2005 prior to the death of the homeowner. All statements after 2010 when she died was directed to my dad and had no reference to her name at all. They "assumed" they had valid insurance and I "assumed" that my dad had no further obligation to pay the insurance especially since the house was up for sale 6 days after we gained entrance. Now the one son is claiming he lived there which was a blatant lie and I assume fraud.

Not if there was a life estate. There, the one with the rights of possession for life has the duty to insure, pay taxes and some other things to the property to protect it. In a contract, the duties would be spelled out in the contract. Because dad took on the responsibility of insuring the property, even if he did not have a written obligation, there may be a quasi-contract called promissory estoppel requiring him to continue the insurance. Or, at least, the duty to properly inform the owners when the insurance is cancelled. In both cases, both parties may want to keep insurance on the property although the possessor is responsible for waste and/or damages negligently caused.

 

[reds1115]

Not if there was a life estate. There, the one with the rights of possession for life has the duty to insure, pay taxes and some other things to the property to protect it. In a contract, the duties would be spelled out in the contract. Because dad took on the responsibility of insuring the property, even if he did not have a written obligation, there may be a quasi-contract called promissory estoppel requiring him to continue the insurance. Or, at least, the duty to properly inform the owners when the insurance is cancelled. In both cases, both parties may want to keep insurance on the property although the possessor is responsible for waste and/or damages negligently caused.

thanks for the info. Temps in Pa for the week of January were in the low teens, single digits. The house was empty and the insurance did not cover an empty house Uninhabited home insurance would have been substantially more. The heat was turned off and the pipes froze. Now the sons are claiming they had been living in the house which is a blatant lie. The electric bill (the house is all electric including heat) for november, an unseasonably cold month in Pa. was $10. According to insurance even if I kept the policy active it would not have covered pipes bursting due to negligence. They are threatening to sue and even if I was in the wrong an active policy would not have covered the damage. When we were at the house early november, every utility was turned off including the water, all appliances unplugged. No signs of life. The son who claims to have lived there was on a business trip for 6 weeks followed by a vacation over christmas starting right after our visit early november. Not sure how long he could have lived there between nov and Jan 5 when the pipes burst if he was gone for a minimum of 7 weeks. When I did this original post I assumed the wet spot on the ceiling was the culprit but came to learn it was much more serious but not something that would be covered. I appreciate your input and I hope I have learned from my mistake.

 

[tranquility]

I don't know if there is any liability on your(your dad's) part. I think it likely there is not. But, I can weave a legal argument that might make the estate liable for something. It is always a good idea to cover yourself when it is possible some act or omission might cost someone money. The best way is by communication, in writing, stating what you are doing and why you are doing it, and then give a time for the other side to respond before taking action. Is that a magic talisman that prevents litigation? No. But it is awesome that when you walk into court you can prove you did everything you could think of to make sure there is no problem. Even if you eventually don't win as a matter of law, the other side would not win as a matter of equity or fairness.

 

[reds1115]

I don't know if there is any liability on your(your dad's) part. I think it likely there is not. But, I can weave a legal argument that might make the estate liable for something. It is always a good idea to cover yourself when it is possible some act or omission might cost someone money. The best way is by communication, in writing, stating what you are doing and why you are doing it, and then give a time for the other side to respond before taking action. Is that a magic talisman that prevents litigation? No. But it is awesome that when you walk into court you can prove you did everything you could think of to make sure there is no problem. Even if you eventually don't win as a matter of law, the other side would not win as a matter of equity or fairness.

Thanks for the great advice. Unfortunately it is water over the dam and I can't do what I've neglected to do. I called the electric company to transfer service and was told her son already cancelled the service, I called the cable company and was told it was already taken care of by her son, I called the phone company and was told the same. The minute they changed the locks and refused to let us in the house to collect dad's belongings, even though I expressed that I needed some of his possessions for the funeral there was lack of communication. I figured they were going along their merry way doing what they needed to do and I would do the same. The insurance policy would not cover an ininhabited house anyway so it was pretty useless. I explained the situation thoroughly to the insurance company and they knew it was a useless policy when I advised there was no one living in the house. So to this lay person it seemed a moot point. I didn't figure anyone would not look into the extended insurance needed on the empty property! There were definitely a lot of assumptions on both sides. I just have to hope the son that is claiming to live there backs down on his claim as the electric bills, the
water bill, etc., and the neighbors and his schedule can all prove he never lived there a day! I hope this doesn't end up with deeper legal trouble for him. Thanks again for all your help and great advice. I'd be armed if I was ever named executrix again But perhaps next time I will just step down**************..